On Monday, we asked our readers what they thought about a number of issues related to enterprise startups. As incentive, we offered 15 tickets to this year’s Stanford Accel Symposium: Re-Imagining the Modern Enterprise.
The result? Anyone who’s read through the comments of past enterprise posts knows our readers have intensely strong and intensely smart opinions on this topic, and our informal poll only confirmed that. What you see below is just a small sampling of the great responses we received, yet it perfectly captures the dichotomies and unresolved issues surrounding this contentious topic:
What companies are you most excited about in the enterprise space and why?
While not everyone agreed it qualified as “enterprise,” around half of the respondents mentioned “Box” in their list of exciting startups. But many of you preferred to focus on trends instead of specific companies, like Etienne Le Scaon:
More than actual companies, I prefer mentioning trends. One of the most interesting ones I see in the enterprise space is the “pervasive workplace”, i.e. the interpenetration of personal and professional life.
Despite Marissa Mayer’s move to restrict work from home, the trend is very strong, has been existing for a while and will last. One trendy term for this is “BYOD” (bring your own device), but who talks about “BYWDH”? (bring your work device at home), which is de facto the case for a very significant part of workers for a long time already, and that keep increasing.
When it comes to companies/products, the ones I see that follow this trend are Armor5, Divide or Mocana on the mobile side, but also oDesk or Freelancer, that allow hundreds of thousands of people to work from home.
What are the biggest challenges facing enterprise companies?
These answers were all over the map. Let’s just say for all the hype surrounding enterprise, companies still face a ton of challenges.
We talk to a lot of vendors at VendorStack and the challenge everyone has (and why vendors like us) is visibility. There are so many new enterprise vendors that organic discovery is tough, particularly since keywords like CRM or Project Management are heavily SEOed.
You can’t just hack together an app and release it to the enterprise. It doesn’t have to be perfect, but businesses are not going to waste their time/money on something that was built in a weekend.
It’s easy to get your first few users, incredibly difficult to win the entire company.
Reliability. If those cloud-based enterprise companies have prolonged downtime, it can hurt their business with companies that are already shy to adopt cloud services.
Is the excitement over enterprise companies a “bubble” or the real deal?
Perhaps unsurprisingly, most of you are evangelists for the enterprise cause. That said, respondents admitted that some companies are artificially inflated by the trend.
The excitement over enteprise-focused startups is here to stay. What’s happening is the”democratization” of IT. What used to be available only to large enteprises, with considerable investment of money AND time, becomes now available to small and medium companies with limited investment.
We are definitely not in an enterprise bubble.
Show me an enterprise startup with a $50 million valuation, and I’ll show you a company with proven product market fit, a strong growth model, and millions in revenue.
Show me a consumer Internet startup with a $50m valuation, and I’m much more likely to show you a feature with an unsustainable growth curve and prayer for monetization.
How should enterprise startups market their products? Should they target end-users (employees) or pitch to employers?
Here, most of you leaned toward pitching to employers while recognizing the value of targeting end-users in the early days of a company.
For the last few years we’ve been drinking the kool-aid, but the most experienced VCs have known all along that ground up was bollocks. Ok, so Dropbox (still not really enterprise IMHO) and Yammer have done well, but I’ve heard Aaron Levie and David Sacks both say that they wish they’d started traditional enterprise sales a lot sooner…Ground up is perhaps only possible for completely new applications which don’t replace anything?
Chris van Loben Sels:
Both. The best enterprise apps bring value to both. Selling directly to employees is critical to not lose your way and just build manager features again. Management apps is a great business – have built great ones at PeopleSoft, Oracle, and Adobe – but that’s not the new opportunity.
Early on, I believe the best strategy is to target end-users with the public-facing product, while also initiating private conversations with firms you know well at an enterprise level. The reason for the former is that entry barriers are much lower, and you get the thing you need most: product feedback. However, you also need to start the latter in order to learn about the standards your product has to meet in order to be used in an enterprise setting (uptime, security, confidentiality, business continuity, etc).
Where does the future of enterprise software lie: On mobile or on desktops?
This was a particularly divisive topic:
Most of the SAAS software today is not truly optimized for mobile. I believe sales and marketing folks within large enterprises will again lead this movement of Enterprise 3.0. They will start doing 70% of their work on their smartphone or tablet if not already 100% . IT departments / CIOs will scramble to catch up with the right kind of apps & security layer.
Salesforce was born because of the last trends (enterprise 2.0). We don’t have a company like that for Enterprise 3.0 yet!
Desktops…At least in the near future, mobiles in the enterprise will still be used primarily for consumption (of business data) and not creation.
Do too many companies call themselves “enterprise” when the label isn’t always accurate?
Perhaps unsurprisingly, we had almost as many different definitions for “enterprise” as we had respondents:
My definition of the term ‘enterprise’ is quite simple. Has the ‘enterprise’ startup employed professional sales reps to peddle their wares and form relationship bonds with big target companies, with multi-million dollar budgets, long sales and buying cycles, integrated into core big company business processes, board level or business unit head level decisions and carrying million dollar quotas? If not, you are not quite an enterprise company. Atlassian supposedly and proudly says they don’t employ sales reps and have been enormously successful in getting very large companies to adopt their geekery via viral means only. While this may be an anomaly, I don’t really see this emerging as the new way to do enterprise sales for business solutions/software, whether on premise or cloud-based.
A company is an enterprise company if its primary source of revenue comes from other enterprises. The definition can’t be more clear.
Of course. We live in an age of buzzwords. My local bodega sells hipster enterprise solutions.